The Golden State’s Golden Payouts No Longer Available to All Retired Athletes

Sep 1, 2017

By Jeff Birren, Senior Writer
These pages have previously recorded the workers’ compensation gold rush that awaited retired professional athletes in California. As noted, for many years all that a retired athlete had to show was that he or she played a single game in California and the courthouse doors flung open wide. The state’s largess was all the more appealing to retired athletes since for all practical purposes California did not start the statute of limitations until a doctor told the athlete that he or she had a “cumulative trauma” claim. Thus, an athlete could be retired for 30 or more years and still bring a claim in California against his non-California club, never mind that the contract would have said that the laws of the Club’s state would apply and that state’s workers’ compensation system was the legal venue. Moreover, California recognized the “cumulative trauma” variety of injury that typically allowed retired athletes to gain a life pension.
These pages have also recorded how the non-California clubs finally began to fight back. Some of those clubs filed grievances against their former players who were seeking such California payouts. They did so on the basis that Paragraph 19 of the Standard Player Contract states that: “This contract shall be governed by the laws of the State of _________________” (the state where the club is/was located.) Moreover, the contracts all also have a mandatory arbitration provision in Paragraph 16, and the NFL-NFLPA Collective Bargaining Agreement (“CBA”) requires that such disputes be submitted to binding arbitration under Article 43 of the CBA. One of those arbitration cases was In re: Houston Texans Workers’ Comp Claims, discussed below.
The non-California clubs also utilized the recent efforts by the California’s legislature and courts to limit the rush to California’s court system with its generous payment scheme. One reason for this change was the recognition that thousands of these cases were brought against defunct insurance companies. As a result, California’s Insurance Guarantee Association had to take over the defense of any payment of those claims, and all of that was paid for by California’s business through a “CIGA” surcharge on its respective insurance policies. Naturally, many athletes chose to ignore a new statute and recent judicial decisions. Some seemed to require an arbitrator to send a personal message to the athlete.
Julius Jones
One of those athletes was Julius Jones. The Dallas Cowboys drafted Jones in 2004 with the 43rd pick of the draft. He played in Dallas through 2007. His contract with Dallas had a choice of law and forum provision that required disputes to be resolved under Texas law. In 2008 and 2009 he played for the Seattle Seahawks. That contract stated that any workers’ compensation claims against the Seahawks would be brought in the State of Washington and resolved under Washington law. He spent 2010 with the New Orleans Saints. That contract also had choice of form and choice of law provisions. In 2013 Jones filed a “cumulative trauma” workers’ compensation claim against the Seattle Seahawks, in California. He did so, he claimed, because the Cowboys held summer camp in California and that he had played in California for the Cowboys early in his career. The Saints may have sighed in relief; although Jones ended his career with the Saints, they were not the party against whom Jones sought to extract cash.
Seattle responded by filing a CBA-Article 43 Grievance against Jones. They did so both on the basis that the contracts stated that he would bring any workers’ compensation claims against Seattle in the State of Washington, and the prior arbitration decision in the Houston Texans matter.
In that proceeding, arbitrator Shyam Das ruled that players who brought claims against the Texans in California breached their employment contracts and issued a cease and desist order against those players. However, Das created two exceptions. The first exception was for players who remained a resident of California while employed by the Texans and the second was for players who entered into their Texans’ employment contract while in California. His final award was issued on Jan. 19, 2016. The NFL Management Council and NFL Players’ Association “have applied the Texas Decision and TexasAgreement in subsequent stipulations, applicable to other players and clubs, that have been incorporated into various stipulated awards” (NFL Management Council, on behalf of The Seattle Seahawks v. The NFL Players Association, on Behalf of Julius Jones, Arbitrator Shyam Das, Arbitrator’s Award, 7-19-2017). Jones was represented by NFLPA counsel and by California workers’ compensation counsel Jordan M. Cohen.
Jones conceded that he did not reside in California and did not sign his Seattle contracts in California. One might have thought that this ended the matter, but it didn’t. For one thing, despite the above, Jones asserted that because he had practiced in California for the Cowboys, the relevant portions of his contract with Seattle should be set aside and he should be allowed to proceed in California against the Seahawks.
He also maintained that the decision in New York Knickerbockers v. WCAB (Macklin), 240 Cal. App. 4th 1229 (2015) meant that California had jurisdiction over his claim. However, in Macklin, the retired basketball player played for the Los Angeles Clippers during his last year of employment, and also practiced for the N.Y. Knicks in California prior to games. Thus Macklin is essentially irrelevant to Jones’ claim as he never played for a California team, never resided in California while playing for a non-California team and never signed a contract in California.
The Seahawks argued that the Houston Texans Decision and Houston Texans Agreement were controlling and constituted the law of the shop. Hundreds of other claims had been dismissed on the basis of that decision and agreement and Jones did not meet either of the exceptions. The club also pointed to the 2013 amendment to the California workers’ compensation statute that further restricted the ability of non-California athletes to bring claims in the state.
The arbitrator agreed with the club. After all, Macklin “did not involve a choice of forum/choice of law provision” (Id. at 4). Furthermore, “the Texans Agreement has served as the basis for subsequent stipulations and rulings affecting hundreds of players whose claims predate the enactment of a new California law relating to claims by professional athletes hired outside California, which took effect on January 1, 2014” (Id.). After all, to decline to apply the Houston Texans Decision “would unfairly prejudice possibly many other players ordered to cease and desist in accordance with the Texans Decision and Texans Agreement” (Id. at 4/5).
In a footnote, arbitrator Das distinguished Jones in his prior decision in another case wherein the player had begun his career with the San Diego Chargers. The player’s contract, with its choice of law and forum provisions, was later assumed by the Kansas City Chiefs and thus Das found that the “circumstances are not comparable to those” in that case” (Id. at 5, FN. 5).
He thus “sustained” the Seahawks grievance (Id.), told Jones that he “is directed to cease and desist pursuing his California claim by dismissing such claim against the club with prejudice” but that the “cease and desist order included in this Award does not preclude Jones from pursuing a claim for specific injury” (should there be one) that occurred in California (should any such exist), consistent with the terms of the “Stipulation incorporated into the Final Award in the Texans case) (Id. at 6).
Manuel White and Jermane Mayberry
The Jones case was presented on March 10, 2017 and Arbitrator’s Award was issued on July 19, 2017. On March 10, 2017 arbitrator Das also heard the non-injury grievance brought by the Washington and New Orleans clubs against White and Mayberry for violating the Houston Texans Agreement. Das issued his award in that case on July 20, 2017 and reached the same result. NFLPA counsel and a lawyer represented White and Mayberry from Minnesota.
The White and Mayberry case was the more complicated one. For one thing, White and Mayberry filed counter-grievances against the clubs, asserting various novel claims, including claims that the clubs: (1) violated their duties under the CBA, breached “the implied covenant of good faith and fair dealing; 2) knowingly, willfully, and/or negligently engaging in tortious and contractual misrepresentations; 3) violating Section 2 of the Article 43 of the CBA (in plain English, it was untimely); and 4) violating the Stay Agreement/California Counsel Mutual Agreement” (NFL Management Council on behalf of The New Orleans Saints and Washington Redskins v. NFLPA on behalf of Manuel White and Jermaine Mayberry and related cross-claims, Arbitrator’s Award by Shyam Das, July 20, 2017 (“Award”) at 3). White and Mayberry further alleged that they “Are not parties to any applicable CBAs; any Agreements between the NFLPA and NFLMC nor any California Counsel Mutual Agreement and therefore are not bound by any determinations made in those matters” (Id.). “At the very least, White argues, the NFLMC and the Clubs have unclean hands and cannot seek to enforce Awards that were procured through their wrongful actions” (Id. at 8) the wrongful actions being ignoring that the players should have been per se exempt as California residents. The untimeliness claim was based on the fact that the Clubs’ grievances “were filed years after (they) filed their California workers’ compensation claims” (Id.).
Stripped of the rhetoric and inconsistent allegations that they are not bound by any CBA but yet assert rights under a CBA, White’s case boiled down to the proposition that since he went to college in California he qualified for the California resident exemption in the Texans Decision and Texans Agreement, and Mayberry’s case was based on the fact that the contract was “made in California when his California agent accepted the contract” (Id. at 5, FN, 5), and that the clubs violated their rights under those documents when they were placed on the cease and desist list.
Both sides sought economic recovery from the other, but the NFLMC withdrew its request based on the NFLPA’s agreement to waive an untimeliness claim within a reasonable period after the issuance of yet another cease and desist order from the arbitrator.
Arbitrator Das noted that in prior Awards, “both Mayberry and White were found to be in violation of their respective Player Contracts” and they were “among those players directed: …to cease and desist pursuing their California claims by dismissing such claims against the Clubs with prejudice, subject to the provisions in Paragraphs 2 and 3 of the Stipulation” (Id. at 5).
For their part, the two clubs made a number of assertions. First, that under the law of the shop an Award cannot be revised absent an agreement between the parties, that the players had to abide by those decisions and that neither had presented a basis to reconsider the prior awards. “Secondly, the clubs cite the well-settled doctrine of functus officio under which an arbitrator cannot reconsider a complete and unambiguous award. Thirdly…the Players arguments should be rejected as waived” as neither made arguments based on facts learned after the awards were issued, and that the claims are meritless. They also asserted that the players’ grievances were untimely and “an improper attempt to litigate their inclusion in their respective Awards, an issue that may not be revisited by this Arbitrator” (Id. at 6).
White and Mayberry did no better than Jones. “In essence, Mayberry and White now contend that they should not have been ordered to cease and desist” (Id. at 9/10). Das pointed out that in a prior Interim Award that was incorporated into a Final Award he stated: “Absent agreement of the Parties, I have no authority to reopen or alter a prior final and binding Arbitration Award at the request of one of the Parties” (Id. at 10). “The same conclusion applies here” (Id.).
Das also stated that the players’ grievances “must be denied” as “the grievance is an improper attempt to litigate their inclusion in the prior Awards under which they were ordered to cease and desist” (Id.). Das then pointed out that under the Houston Texans agreement, players had the “burden of production to prove he was a resident of California while employed by the Club if the player sought to be excluded from a desist order” (Id. at 10/11), and that the club did not have the burden to make such an inquiry. Moreover, all of the “facts and evidence that Mayberry and White now cite to support their belated claims that they should have been excluded from cease and desist order were available to them prior to issuance of those orders” and “the Stipulations under which Mayberry and White were ordered to cease and desist were just that—Stipulations by the NFLMC and the NFLPA based on application of the Texans Agreement, which was based on the Texans Decision” and that any claim that the Club’s grievances were untimely “had to have been made before the cease and desist orders at issue were imposed in the prior Awards” (Id.).
Arbitrator Das ended his Award by consolidating the prior awards into “this Award,” ordered Mayberry and White “to comply with the cease and desist orders” previously issued and denied their grievances, (Id. at 12).
Should Mayberry and White fail to comply with the cease and desist orders, they will face damage claims by the clubs. That same fate will undoubtedly fall upon other players who sat on their rights, if they had any, while the NFL Players’ Association was entering into the various stipulations with the NFL Management Council regarding which players could continue their California workers’ compensation claims against their non-California club-employers.


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